Growth Slowed For Big U.S.-Based Public Equipment And Supplies Companies In Fourth Quarter 2014

Nine publicly reporting equipment and supplies companies based in the U.S. saw combined revenue growth slow to 2.7% in the fourth quarter of 2014 vs. the same quarter in 2013. It was the slowest quarter since the third quarter 2012 and follows four consecutive quarters during which growth exceeded 6.5%. The numbers are compiled for Foodservice Equipment Reports by John Muldowney, Principal at Clarity Marketing. All the companies have significant sales outside North America.

For all of 2014, the nine reporting companies’ combined revenues rose 5%, with a 6% gain for six equipment-oriented companies. The three supplies-oriented companies saw combined sales fall 0.2%, as results were dragged down by the troubles of EveryWare Global, which saw sales fall 13.4% in calendar 2014. The other two supplies-oriented companies, Libbey Foodservice and Carlisle Foodservice, each reported annual sales gains of 2.3%.

Total sales of the six reporting equipment companies rose 3.3% in the quarter. Five of the six equipment companies had positive gains in the quarter. Middleby Corp. boosted sales 14.8% while Standex Foodservice saw sales rise 12.7%. ITW Food Equipment Group had an estimated 5.4% gain for foodservice products, Rational North America was up 2.5% and Unified Brands posted a 1.5% gain. But the overall equipment results were pulled down by a 6.3% decline in sales at Manitowoc Foodservice in the quarter. As the largest single company in the tally with annual sales approaching $1.6 billion, Manitowoc’s results had a significant impact on the totals.

Sales of four of the six equipment companies were positive for the year. Middleby grew annual sales 16.3%, Standex sales rose 6.5%, ITW FEG was up an estimated 5.5% in North America and 6.4% worldwide and Manitowoc posted 2.5% growth. Unified Brands was flat for the year and sales at Rational North America fell 3.2%.

Libbey Foodservice sales rose 1.4% in the fourth quarter; Carlisle Foodservice was off 1.7% in the quarter. EveryWare sales decline slowed in the fourth quarter; the company’s sales fell 7.1% in the period.

The big public companies underperformed the broader E&S market in North America. The Manufacturers’ Agents Association for the Foodservice Industry, which surveys its members in the U.S. and Canada, reported an overall 2.9% sales gain in the fourth quarter. The public companies are more closely tied to big chains such as McDonald’s and Yum! Brands than the general market. Both chains are struggling in the U.S. and China, among other markets. The public companies also have been affected by weak results in the sluggish European and Japanese markets, as well as a slowdown in growth in China.